VS Code + Node Launch + Run Time Args

Currently attempting to setup VS Code to run a node app, however, unable to get it to work correctly. I can run it however manually without an issue. With the goal once it's running to be able to attach to the node process for breakpoint debugging:

Manual operation that works:

1. navigate to the directory: /Users/me/source/app_modules/main-api/
2. run nvm use 12 to be using v12.22.1
3. run node -r esm dev-server.js

Runs correctly, and loads the esm package module so imports work correctly.

When running with launch.json:

{
    "version": "0.2.0",
    "configurations": [
        {
            "envFile": "${workspaceFolder}/app_modules/main-api/.env.local",
            "type": "node",
            "request": "launch",
            "name": "Launch API",
            "cwd": "${workspaceFolder}/app_modules/main-api/",
            "runtimeVersion": "12",
            "runtimeArgs": ["-r esm"],
            "program": "${workspaceFolder}/app_modules/main-api/dev-server.js",
        }
    ]
}

Running with this results in: /Users/me/.nvm/versions/node/v12.22.12/bin/node: bad option: -r esm

It's not finding the node_modules even though I request it to use the main-api directory as the main working directory.